Designing the Next Wave of Competition Policy

Skepticism of concentrated corporate power has deep roots in our American tradition. We enacted antitrust laws in line with this tradition, to ensure that corporations wielding monopolistic power could not use it to coerce, dominate, or cheat other participants in the marketplace.¹ Freedom from fear—of your crucial business inputs becoming unavailable, of your access to customers being cut off, of being trapped in a job with no control over your work life, of your economic security and livelihood being fully out of your control—is a core part of the liberty our antitrust laws were designed to ensure.² In our modern, hyperconcentrated economy, thinkers from across the political spectrum recognize the need for a revived competition policy to constrain corporate power and thus protect American opportunity and American democracy.³

The past four years saw significant gains in efforts to reinvigorate these laws and reanimate fair rules of the road for consumers, patients, workers, renters, and small businesses—the market participants who can’t protect themselves from being squeezed, cheated, trapped, or worse. The Biden administration’s strong appointments in core antitrust enforcement agencies, coupled with its whole-of-government approach as embodied in the executive order on competition that created the White House Competition Council, achieved a wide array of concrete wins for families: bringing down health-care costs, cracking down on junk fees that nickel-and-dime consumers, banning contract clauses that trap workers in jobs and hold down wages, attacking algorithmic collusion that jacks up rents, going after mergers that would raise prices at the grocery counter, and more. This work required an unwavering willingness to confront power used not only to squeeze market participants but also to capture and constrain our political parties and the instruments of government. And, indeed, the popular will awakened against these forces has gained some measure of bipartisan commitment, as shown through some of the Trump administration’s appointments and actions to date. The selection of Gail Slater as head of the antitrust division at the Department of Justice (DOJ) signals that a more aggressive approach to Big Tech may continue, and DOJ and Federal Trade Commission (FTC) leadership have committed to follow the updated 2023 merger guidelines finalized under Biden-era FTC Chair Lina Khan.⁴

But the work is not done. Many questions that four governing years could not possibly answer require additional attention. Indeed, there should be a major rethink of what rules should exist, not just how we should apply the ones we have. That said, based on my experience in the Biden administration, three key priorities for governing are particularly worth mentioning.

First, much remains to be done in further embedding a whole-of-government approach into the work of other agencies. To name just one example that has some bipartisan support: The Department of Health and Human Services has myriad tools to control corporate power in our health-care system to the benefit of patients and providers. Interventions like regulating health-care middlemen,⁵ stopping patent shenanigans by drug companies,⁶ and limiting consolidation in hospitals and other providers that lower the quality and increase the cost of care should all be on the table. We need detailed work on how we can use existing authorities of industry regulators—in particular in the industries that deliver essential goods and services to people such as health care, housing, and energy—to curb corporate power and develop fair market rules that work to the public’s benefit.

Second, the application of antitrust to labor markets merits special attention. All markets have workers, and all of us are, have been, or will be workers, paid or unpaid, over the course of our lives. Empowerment in the workplace holds a special place in the project of greater freedom and democracy, and building power for workers is a key part of the strategy to maintain democratic and popular control of government. Both antitrust and labor law conceive of ways to limit the power of concentrated capital, but they use different tools to do so. And while the antitrust agencies over the past four years made concerted efforts to begin to apply their tools to labor markets, those tools are still mired in a neoclassical economic analysis reliant on perfect competition as a goal. But everyone, from members of Congress⁷ to any worker who’s ever signed an employment agreement, knows that labor relations are characterized by unequal bargaining power, information asymmetries, and other barriers to worker empowerment.⁸ In addition, lax antitrust has played a key role in loosening the guardrails on firms in ways that allowed for the disintegration of production and fissuring of the workplace, to the detriment of worker power. We must engage in the theoretical and empirical work to integrate worker power and voice into the kind of labor market competition that antitrust enforcement seeks to achieve.

Third, there is a lesson in how the Biden administration made competition policy. Progressives must make a concerted effort to ensure that the machinery of government is in fact fully and meaningfully open to the public it purports to serve—in order to set our agendas in accordance with people’s needs and wants, to involve people in the process of democratic governance, and to break control of corporate interests over regulatory policy. Over the past four years, the Office of Information and Regulatory Affairs pushed to open the regulatory process to all those affected, not just those with access to sophisticated lobbyists. The FTC more than answered that call, launching open commission meetings, introducing a new merger review process that is open to public comment, and otherwise incorporating feedback from the public—including those most directly and personally impacted by mergers—on matters once thought to be the sole domain of highly paid lawyers, lobbyists, and experts. Democratization of our market governance mechanisms—and our policy development process—is crucial to ensuring that they serve the entire public and that the public sees itself in those democratic outcomes. 

Other important areas for further study include resolving contradictions between competition and industrial policy in a way that serves the twin goals of building domestic industry and constraining corporate power, checking the power of Big Tech companies over the traditional and social media information ecosystem in service of the health of our democracy, setting rules for the emerging markets for tech and AI in a way that ensures socially positive outcomes, and developing tax policy that constrains rather than encourages consolidation. Even more importantly, in a moment where the so-called Department of Government Efficiency is dismantling government institutions, we need to think big about what our antitrust enforcement agencies will look like and how to build them back, not as they were but as they should be, in order to best deliver the kind of market regulation people deserve.

Most crucially, in all these areas we must generate ideas for the next wave of competition policy that starts from the pain points people experience in markets, supports coalitions with the power to take on concentrated corporate interests, and calls on government to fight on behalf of the public and its economic liberty.